claiming for expenss property fell through

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  • jpkeates
    replied
    A property developer (which is what I understand you mean by property trader) is either paying income tax on the growth already,
    so the capital to revenue switch issue doesn't apply or running it as a ltd company business, where different tax rules apply anyway.

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  • Dan_Manchester
    replied
    We need to be careful about the advice given on the site in my opinion.

    My understanding is that HMRC draw 2 'lines in the sand' in relation to property,:

    - Property investor -> generally holding for long term and renting out
    - Property trader -> Effectively buying and 'flipping' property for profit.

    The former cannot claim for abortive costs the latter can.

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  • King_Maker
    replied
    The deductions for CGT are very restrictive - and abortive purchase fees are unlikely to qualify.

    Nor are such expenses incidental costs of finance.

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  • jpkeates
    replied
    It's because they would have been capital costs had the transaction gone ahead
    and they can't change to revenue because it didn't.

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  • Claymore
    replied
    The above has always been my understanding, but I was wondering if there are any HMRC documents to back this up.?

    In my opinion, if HMRC regard letting properties as a business (as they do), I really would of thought, if you can prove the property which fell through was for the portfolio - they should allow the loss to go through as a legitimate business expense. It's just my own opinion.

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  • King_Maker
    replied
    Not for an individual.

    Possibly for a limited company.

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  • rental
    started a topic claiming for expenss property fell through

    claiming for expenss property fell through

    Hi
    Just wondering if you can offset for expenses such as valuation, solicitors fees if the purchase of the btl property falls through (I have other btls)

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